Yahoo!’s music prices to increase

By
10.24.2005 :: 12:24PM EST

Yahoo! announced to subscribers of its portable music subscription service that it will increase rental rates for the service on November 1. The company released its Music Unlimited subscription service in August after a three-month beta testing period. The service's debut prices were considerably lower than Yahoo!'s competitors' prices: US$4.99 per month for one year with unlimited downloads to a portable music device, and $6.99 on a month-to-month basis.

The new rates will be $9.99 per month with a one-year subscription and $11.99 month-to-month. However, these new rates only apply to the subscription service for downloading songs to mobile devices; users who only want access to play songs on their computers will still pay the lower prices. Yahoo! also says that it will honor one-year subscriptions made before November 1st at the lower rate.

The company gave no indication why it was increasing its rates, but the move is not a surprise to analysts. Many were saying that Yahoo!'s prices would not be able to stay so low without cutting steeply into the company's profits.

JOSHUA'S OPINION
Subscription services are the big deal nowadays, aren't they? The value in renting things is pretty obvious: you will always have the top-of-the-line product or service. The downside is that you end up not owning anything tangible.

Of course, there is a minor difficulty in that arena when you are dealing with digital music. Do you actually own anything? How much are a bunch of bits worth? The digital marketplace is really an interesting animal to me. No longer are we trading hard currency for tangible products; now we are buying lots of digital content that takes up space on hard drives and that is not guaranteed to last. The inevitable question is whether or not those goods are really worth the money we paid for them. Can you sell the songs? Can you make back at least a portion of the money you put into those Village People tracks you bought on a whim and immediately hated?

That is the value of an audio CD. At least with a CD you have a tangible item that you can sell–one that does not have a scrawled title in permanent marker on the top, that is.

USER COMMENTS 13 comment(s)

Another one bites the dust!(12:30pm EST Mon Oct 24 2005)Bow down Yahoo and recognize your master, the RIAA!!! If they want more money, the Yahoo must obey!!!! Obey!!! – by TheCarnifex

excellent marketing(12:45pm EST Mon Oct 24 2005)Internal Memo: Our Yahoo music subscription service not gaining subscribers as expected, because it seems most people still prefer to pay per download. Yahoo profits are at stake.&#10

&#10 Recommendation: *raise* prices. Make our current subscribers feel they must be getting something good because it costs so much. New subscribers will also be attracted by high prices, we feel, and once they realize that if they stop paying, they lose all the music they downloaded, it's too late– we have them by the nads. – by ToeKnee

Re:ToeKnee(1:20pm EST Mon Oct 24 2005)They are selling the same file, located on a hard drive over and over again. Essentially, the sales involve zero restock fees, zero shipping fees, and zero work to maintain. Spoilage is zero. Pure profit.

Why did this model come into effect? Because some industrious people thought that one way to shut down music piracy was to provide an economical way to obtain the music instead of downloading it.

So, the RIAA does NOTHING and now they are making Billions, for ZERO extra effort. No marketing, no promoting, literally they do NOTHING.

The 'Free' money is producing greed. The thought process is 'if I can get $2 Billon/year for nothing why not $3 Billion'?

End result … Hello Bit torrent – by Hodar

Paying for value(2:01pm EST Mon Oct 24 2005)When one considers “file size” between an “.avi” file on a CD and an “.mp3” file of a typical download there is a very large difference in not only “quantity” of information delived to the consumer but also the “quality” of information delivered. Shouldn't the consumer demand and receive a price break for the inferior product? – by AFreeMan

Just say no(3:20pm EST Mon Oct 24 2005)to subscription services. It reinforces the idea that when you 'buy' something, you do not 'own' it. The way most license agreements are written these days, the buyer essentially has no rights, not even 'fair use'. If you don't agree with the entertainment industry's definition of 'purchase', then you have little recourse besides NOT PURCHASING the product.

I have not bought a music CD in almost 2 years and have never bought any downloaded music for this reason. – by JRink

Stop paying for music(5:03pm EST Mon Oct 24 2005)Whatever happened to supply and demand? It's now more like we demand our price or you go to jail. Sounds like a bunch of crooks to me. If I had the money to bribe politicians into making rules in my favor, I could turn anyone into a thief, too. Big whoopdeedoo. I could give a rat's ass what RIAA folks call me. I WILL NOT PAY FOR ANY MORE MUSIC until prices are cut at least in half. There's no reason I should pay more than $6 for a CD. Just like sports, music used to be something people did simply for enjoyment. I guess it's a small price to pay for not being communist, but damn, I'm not paying a cent more than what I think is a fair price. – by Kill Me First

Down With Capitalism(5:09pm EST Mon Oct 24 2005)Yeah, I want a king. One with a pretty thingy around his head that sparkles. If I had one of those, I could put an end to the madness of greedy bastards who hoard all the good stuff for themselves. Off with ye head ye bloody RIAA imbecile. Whack! Ahh, for the good old days. – by Oppression Rules

grow up u whiners!(5:25pm EST Mon Oct 24 2005)i'm not a fan of the RIAA, but I am a fan of the artists who create the music. ripping them off cannot be rationalized away by your stupid whining about corporate greed. you're just as greedy as the RIAA. – by pay it forward

Whew..(5:49pm EST Mon Oct 24 2005)Though I was gonna have to pay more cash. Good thing my music device wasnt DRM capable or I would have had to pay more. Subscription is still the best method for me. I'm not one of these new age freaks who all have ipods and dance and live in some big metropolis like its cool. So, subscription works for me. Download to my machine and play on my h.t.s. with supreme audio quality. Wow my collection is over 490 songs and i have only paid $14 in 2 months. Hmm… lets see for apples music deal, $0.99 x 490 = $485.10. hmm $14 or $485. Plus i can keep ripping the music so long as you make new play lists. So how can you loose. Well unless your into p.m.ds then this service is the best in my opinion. – by Allrightythen?

Allrightythen(7:04pm EST Mon Oct 24 2005)Stop paying your subscription fees and see what you saved or for that matter, what you have. – by AFreeMan

Hmmm(11:01pm EST Mon Oct 24 2005)Is there a limit on the songs you can download per month? Or can you download 100 gigs of songs per month? :)